MTN, Telkom outsourcing deal talks drag on

12 Feb 2015

South African operator Telkom has disclosed that it remains in discussions with rival MTN in regards to the potential extension of the existing roaming agreement between the two companies to include bilateral roaming and outsourcing of the operation of Telkom’s radio access network (RAN) to MTN. If successfully concluded, the deal may have a material effect on the price of Telkom’s securities. Accordingly, shareholders were advised to continue exercising caution when dealing in Telkom securities, with the company pledging to update its investors as soon as the deal receives the appropriate legal and regulatory approvals.

As previously reported by TeleGeography’s CommsUpdate, in March 2014 Telkom signed an agreement with rival MTN, under which the latter will take over the deployment and operation of Telkom’s RAN, although both companies will ‘retain and enhance [their] competitive differentiation and flexibility’. However, if the deal gets approval from the relevant authorities, MTN will not get access to Telkom’s 4G Long Term Evolution (LTE)-suitable spectrum in the 2.3GHz band, as the negotiations between the two companies specifically excluded the LTE band.

South Africa, MTN South Africa, Telkom South Africa